FCA and PRA publish guidance on key workers in financial services

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FCA and PRA publish guidance on key workers in financial services

The UK Government has requested that schools and all childcare providers continue to provide care for a limited number of children whose parents are critical to the Covid-19 response and cannot be safely cared for at home. This extends to those parents who work in financial services who are needed for the provision of essential financial services (referred to as “Key FS Workers“).

The FCA and PRA have recently published their own guidance to assist dual regulated or FCA solo-regulated firms with identifying their Key FS Workers. These will be those individuals who fulfil roles necessary for the firm to continue to provide essential daily financial services to consumers, or to ensure the continued functioning of markets. Both regulators also highlight that firms should identify any critical outsource partners who are essential to continued provision of services, even where these are not financial services firms.

Identifying Key FS Workers

The PRA recommends that the SMF1 Chief Executive Officer (or the most relevant member of the senior management team if one is not appointed) be accountable for ensuring an adequate identification process so that only roles meeting the definition are designated. The starting point for deciding which staff constitute Key FS Workers is to

identify the activities, services or operations which, if interrupted, are likely to lead to the disruption of essential services to the real economy or financial stability.Firms should then identify the individuals that are essential to support these functions.

Staff which may be properly designed Key Financial Workers could include those individuals who are essential for:

the overall management of the firm, for example individuals captured by the Senior Managers Regime;

the running of online services and processing;

the running of branches and providing essential customer services, such as those dealing with consumer queries (including via call centres), client money and client assets and those maintaining access to cash and other payment services;

payments processing and of cash distribution services;

facilitating corporate and retail lending and administrating the repayment of debt;

processing of claims and renewal of insurance;

the operation of trading venues and other critical elements of market infrastructure; or

ensuring the firm meets its customers’ needs and its obligations under the regulatory system, for example those working within risk management, compliance and audit teams.

The PRA further advises that those staff who provide essential support to allow the functioning of the such roles, such as finance and I.T. staff, could also fall within scope.

Both regulators recommend that firms should consider issuing a letter to all individuals identified as Key FS Workers that evidences their status as such and can be presented to schools on request.

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